Assessing the estate Value and filing the Inheritance Tax To avoid penalties or additional payments it is recommended to hire a Tax professional to calculate the heirs Inheritance Tax.
In order to calculate the inheritance Tax it is necessary to figure out the total value of the inherited estate, subtract the debts owed by the deceased, and apply the deductions and scales allowed by the authorities in accordance to your relationship with the deceased person (Groups – see below). Finally in accordance with the inheritors’ residence status, use the corresponding Region or Nation Tax Scales Tables to reach the amount that must be paid to the Tax Authorities.
As mentioned, the allowances and the tax rates, deductions and exemptions vary depending on the Group the beneficiary falls into. In accordance with the succession laws groups classify heirs in accordance to their consanguinity and affinity line with the deceased. Group I: Children and adopted Children under21 years/old. Group II: Children and adopted Children of 21 years old or older, grandchildren, parents, grandparents, spouses, unmarried Surviving Spouse Estate: partners registered as a Pareja de Hecho (only in Assuming that most of a couple’s certain regions) Group III: Other relatives of 2nd and 3rd grade, in-law relatives. Stepchildren, cousins, nieces and nephews, aunts and uncles, siblings, and inlaws and their ascendants/descendants.
assets were acquired during their marriage implies that about half of their assets are not part of the deceased person’s estate. Half of the assets belong to the surviving spouse.
Group IV: Other further grade relatives. No reduction is applied to these cases. All others including unmarried partners, unless registered as Pareja de Hecho in certain Regions Deductions and Tax Exemptions The present law provides a total exemption from taxes only for portions under €15,956.87. It applies to each inheritor, not to the total estate. FAQ – But I guess I am exempt from This exemption applies to portions between parents, children, spouses and siblings. For uncles, cousins and nephews, this exemption is cut by half (€8,000). For more distant relatives, or those not related at all, there is no exemption.
IHT as I am the spouse of the deceased? Unlike in Britain, there is no exemption from inheritance tax between husband and wife. A tax form must be completed and the taxes paid. Depending of regions and under specific circumstances the tax will be almost zero though.